Stock-related expenses sting Jones Soda earnings

by Eric Schroeder
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SEATTLE — Jones Soda Co. said first-quarter earnings fell sharply on more than $385,000 in stock-related expenses, but sales rose 27% behind strong demand for its premium sodas.

Net income in the first quarter ended March 31 was $2,542,000, down from $16,928,000 in the same period last year. Net sales for the quarter grew 27% to $8,760,380, driven in part by a Valentine’s Day promotion.

"Our first-quarter results were fueled by strong demand across the board and represent a solid beginning to fiscal 2006," said Peter van Stolk, president and chief executive officer. "During the quarter we continued to take advantage of our enhanced sales and marketing platform to drive meaningful top-line growth, while at the same time we experienced a 310 basis point improvement in gross margin. Equally important, our balance sheet is substantially improved compared to a year ago. As we approach the key summer selling season, we are encouraged by the pace of our business and our entire organization remains focused on successfully executing our strategic plan."

Mr. van Stolk also said he was pleased with the recent performance of the company’s direct-store distribution and direct-to-retail business segments.

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